Judge dismisses Bear Stearns suit

Manhattan Justice Herman Cahn said Bear Stearns officials tried to save some of the company's $1.5 billion value and avoid a bankruptcy "with potentially cataclysmic consequences" for shareholders and the economy.

The lawsuits charged that JPMorgan's purchase price of $10 a share was too low. The firm now owns 44.9% of Bear Stearns.

Mr. Cahn also said Bear Stearns' directors were protected from liability by the business judgment rule. That says company leaders who make decisions in good faith cannot be blamed if things go wrong as a result.

Mr. Cahn said bankruptcy might have left shareholders with nothing, adding: "The court should not, and will not, second guess" the directors' decisions.

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